Seven Nigerian states have waived right-of-way (RoW) fees to boost connectivity and attract telecoms investments. These states, according to data from the National Bureau of Statistics (NBS), had a combined total of 31.17 million mobile subscriptions as of the first quarter of 2024.
RoW is a fee that telecom operators pay state governments for permission to dig up the roads and install telecom infrastructure, such as fibre optic cables that carry internet traffic.
However, inconsistencies in these fees across states have hindered investments in internet infrastructure, leading to slower or unreliable internet services for subscribers. Despite government efforts to set the fee at a standardised N145 per linear meter, disparities remain in many states, with some, like Ebonyi, charging up to 69 times more than others, like Ekiti, which has the lowest RoW cost.
“It is estimated that, if charges for RoW were reduced in all states to the agreed level of N145 per metre, it would reduce the cost of national network rollout by around 15 percent,” stated, GSMA, the global body for mobile operators.
The states waiving RoW fees include Zamfara, Katsina, Anambra, Kebbi, Nasarawa, Bauchi, and Adamawa, which together had 10,542.1km of fibre network at the end of 2023, according to a White Paper from the Ministry of Communications, Innovation and Digital Economy.
In a Nigerian Communications Commission (NCC) document seen by BusinessDay, the regulator said this waiver will build resilience in connectivity across the country. “Through the advocacy efforts of the commission, seven states in Nigeria today have waived off the Rights of Way fees charged to telecommunication operators,” the document read.
“Nigeria has fast internet capacity on its shores, but this capacity cannot reach people without fibre. RoW challenges have gotten in the way of this over the years,” someone familiar with the matter said.
For instance, stakeholders in the telecoms industry recently noted that high ROW fees will impact the Federal Government’s plan to deploy 90,000 kilometres of fibre optic cables the country needs to plug its connectivity gap.
Read also: Nigerian Entrepreneurs thrive despite economic challenges -Dele Fasemo
“The issues of the high cost of right-of-way, destruction of fibre by road construction companies and vandals all need to be addressed for this new SPV initiative to be successful,” said Chidi Ibisi, executive director of Broadbased Communications.
Limited connectivity has led to usage gaps, with more than 120 million Nigerians not using mobile internet due to infrastructure and affordability issues, according to GSMA. The NCC estimates that 27 million Nigerians still lack telecom access, while 301 local government areas have no internet service. Without proper RoW processes, operators cannot lay the necessary fibre.
“These networks are an essential component of all modern communications networks and form an integral part of mobile networks,” stated GSMA.
“The cost of building and operating fibre-optic networks has increased because of the difficulty and expense of obtaining Rights of Way (RoW) from state authorities…,” it added.
Many states view RoW as a revenue source, making waivers challenging. Gbenga Adebayo, chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), said, “This issue of state governments seeing right of way as IGR should be a thing of the past. We can’t talk about the digital economy on one side and the government is seeing those who provide the services as sources of revenue.”
Streamlining RoW processes and cutting approval times will accelerate connectivity, GSMA suggested in its Nigeria Digital Economy report.
One of the key pillars of the ministry of communications is digital infrastructure, and Bosun Tijani, who heads the ministry, has prioritised fibre broadband rollout across the country. Securing waivers from states has formed part of the mandate of Aminu Maida, the executive vice chairman of the NCC.
“As the Commission engages more states on the benefits of creating an enabling environment for telecommunications investments, including increased connectivity, economic growth, and improved digital services through waiving the RoW charges, we are hoping that other states
would toe a similar line in easing these charges,” he tweeted recently.
However, Adebayo of ALTON recently noted that some states waive RoW fees only to impose alternative charges. “When you go to such a state, they may give you right of way for zero or one Naira, but they will give you developmental levy, education levy, state impact levy, ecosystem levy. When you add all of these together, it is more than the right-of-way charges. So, who is playing who,” he added.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
